China and the USA have agreed to reduce import tariffs, at least temporarily. The tariff on imports of Chinese goods into the US will be reduced from 145% to 30% from 14 May and tariffs on imports of US-made goods into China will be reduced from 125% to 10% for a period of 90 days - with the possibility of an extension. Long-term negotiations are expected for the elaboration of a detailed, comprehensive agreement - although it is also possible that a comprehensive framework will not be reached at all.

The stock and energy markets have reacted to this news. Both share indices and oil and gas prices have risen significantly in anticipation of higher economic output in both countries. This raises the question of whether the relatively large increases in natural gas prices are solely due to the easing of the trade war between the world's two largest economic powers or whether they already include surcharges for the sanctions threatened against Russia in Kiev by the heads of state/government of four European partners - probably also on Russian natural gas.

In this context, the question of the development of the Power of Siberia 2 (PoS 2) natural gas pipeline also arises. PoS 2 is intended to transport Russian natural gas to China and thus provide an additional source of income for Russia, which has had to and continues to suffer major losses of income as a result of the sanctions. Since the painful effects of the sanctions materialised from a Russian perspective, Russia has been trying to make PoS 2 "palatable" to the Chinese - but so far without resounding success. According to a report by Bloomberg, this pipeline project was put on the agenda for the meeting between Presidents Xi Jinping and Vladimir Putin during President Xi Jinping's visit to Moscow. China could obtain up to 50 billion Nm3/year of "cheap" Russian natural gas via PoS 2 - Russia would have an additional source of income. The two main hurdles appear to be pricing and the route. China is trying to get a price that is between the price of natural gas sold in Russia by Gazprom and the price of the Power of Siberia 1 (PoS 1) pipeline natural gas. PoS 1 has been supplying Russian natural gas to China since 2019 and recently reached its maximum capacity of 38 billion Nm3 per year. With regard to the route of PoS 2, China wants the pipeline not to run through Mongolia, but to build a direct connection between Russia and China.

Although the initial situation - at first glance - promises a win-win situation, China does not yet appear to be fully convinced - otherwise a cheering announcement - at least from the Russian perspective - would have already been published after the meeting between the two heads of state. It remains exciting.